Is this just a correction – or the start of something bigger?

The gold price continued to tumble yesterday.

But it wasn't the only market feeling the pressure. Most commodities slid too. And even the S&P 500 index had its worst day for around six months.

Most reports placed the blame on China's weak GDP data. The people who write market reports have to find reasons for market moves, and that was as good a reason as any.

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But China's data was just the latest in a long line of hints that things are not as rosy for the global economy as perhaps markets have priced in.

In short, the recent sell-off could just be a sign that investors are finally experiencing a nasty wake-up call

The fixes' start to come undone

In the first quarter of this year, China's economy grew at an annual rate of 7.7%. That was less than the 8% expected. It also compared to 7.9% in the fourth quarter.

Now, 7.7% is hardly disastrous. But people are pretty sceptical of China's data at the best of times. If 7.7% is what they'll admit to, what's the real data like?

More importantly, it's all part of a bigger trend. The concern for markets is that a lot of the good news that was priced in at the end of last year is starting to unravel.

The real worry about China is that it was meant to be fixed. The Chinese leadership was meant to be doing "whatever it takes" to prop up their economy. Instead it looks as though they've decided that cracking down on property bubbles and corruption are a bigger priority than keeping the boom going.

That perhaps shouldn't come as a surprise. In Britain, the majority of voters own their own home. So, cynical as it may be, it makes sense for the party in power to do its best to keep house prices rising. Higher house prices = more votes for the incumbent party.

But in China, high and rising property prices only highlight the gap between the haves and the have-nots. If the have-nots' start to believe that there is no hope of ever becoming haves', that's when people start to talk about revolution.

So there's no sensible reason for China to encourage stratospheric property prices. And who cares about the stock market? Everyone knows it's a big roulette game anyway. If China wants to generate a wealth effect', what it really needs is a better social safety net.

This is bad news for the mining sector and commodity prices in general. It's not great for luxury goods producers either, as my colleague Merryn Somerset Webb has been noting on her blog.

And there's no guarantee that China will be able to rebalance' easily away from infrastructure, and towards consumers. A full-blown hard landing might be a necessary part of that. That wouldn't be pretty for lots of companies many US-listed that have pinned their hopes on Chinese growth compensating for weakness everywhere else.

So it's small wonder that the Chinese economic news rattled markets so badly.

It's not just China

Of course, it's not just China. Europe is another area that was meant to be fixed. Mario Draghi was meant to be doing "whatever it takes" to save the euro. But life is more complicated than that. Draghi has to juggle the demands of many masters, and the Germans are in no mood for bail-outs right now.

Draghi may have won breathing space for the eurozone last year. But instead of using it to find ways to help out troubled nations like Greece and Italy, Europe seems to be hoping that the mere promise of European Central Bank action will hold things together. The strict line taken with Cyprus shows that the idea of sharing the pain' with their fellow Europeans has not yet taken hold across the eurozone.

As we noted last week, this looks likely to end in yet another crisis. And if that happens, either Draghi will have to deliver, or someone will have to leave the eurozone.

Finally, there's the US. The US was meant to be fixed too. The housing recovery was turning back into boom. The discovery of shale gas meant lots of new jobs and new opportunities.

That's all true. But nothing goes up in a straight line. Hopes have risen rapidly enough now that any economic data that fails to beat expectations is seen as disappointing. That's a problem, because recent data has been awful. The latest monthly jobless figures were woeful. Surveys on manufacturing and consumer confidence have been rotten too.

Investors were getting so used to being optimistic about the US economy that they didn't even seem that worried about the prospect of quantitative easing (QE) being tapered off this year. Now they're having to re-evaluate. And even the prospect of more QE might not cheer them, if it seems that the results from this last batch haven't achieved much in the real' economy.

Plenty of people have been waiting to buy the correction' in this market when it arrives. But now that it's here, they might be tempted to hold off a little longer, to see how far it goes. If we don't see some good news out of the US soon, I suspect we'll see stocks fall further.

How does that affect you? It's easy to get jittery at points like this. Particularly after 2008, it can feel like every slide in the markets is the forerunner to another epic crash.

But don't panic. Stick to your plan. I won't be looking to buy into the US it's too expensive by historic standards. It'd need to fall a fair bit further for me to get interested.

But I'd keep drip-feeding money into the markets we like, such as Japan. That way, you get to benefit from any dips in the market by buying more stocks when they're cheap. It's a more sensible way to invest than trying to time the market. We've written a lot more about this (and the other vital concept rebalancing) in our MoneyWeek Basics series. If you haven't read this yet, you can sign up for the free email here.

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